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LATEST NEWS & EVENTS Firms should 'do their homework' when engaging in debt recovery  Companies have been encouraged to do their homework when they are engaged in the process of debt recovery. Writing in Fresh Business Thinking, expert Karl Wilson suggested that it is essential to do background checks on customers before entering into agreements with them. He pointed out that the current economic problems are making it difficult for firms to recover money that is owed to them and, with cash flow being essential, many enterprises are finding it difficult to survive. However, by using tools such as company searches, bankruptcy searches and trade references, businesses can reduce their risk of falling victim to such financial problems, he suggested. Mr Wilson added: "To avoid uncertainty, get a written contract drawn up to confirm your terms of business. In the absence of a contract, provide e-mail confirmation of what's been agreed with the customer." Recently, R3 revealed that the number of acquisitions of insolvent firms in the UK doubled over the course of last year, showing how tough trading conditions remain. Rick Munro, head of dispute resolution at Lamport Bassitt, said: "'KYC' or know your client is always an important principle, especially in recessionary times. "It is surprising just how often substantial credit is extended to organisations with an inadequate trading history and balance sheet." 
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